Developing and verifying a model of AS interconnection, we propose to study various interconnection practices, the stability and dynamics of interdomain links, and economic properties of the resulting equilibrium.

Despite much recent interest in economic aspects of the Internet, such as
network interconnection (peering), pricing, performance, and the
profitability of various network types, two historical developments
contribute to a persistent disconnect between economic models and actual
operational practices on the Internet. First, the Internet became too
complex -- in traffic dynamics, topology, and economics -- for currently
available analytical tools to allow realistic modeling. Second, the data
needed to parameterize more realistic models -- interdomain traffic
characteristics, routing and peering policies and pricing/cost structures --
has simply not been available. The problem is fundamental, and familiar:
simple models have limited validity, and complex models cannot be validated.
In this research project we made significant progress towards two goals:
creating more powerful, empirically parameterized computational tools, and
enabling broader validation than previously possible.

This research comprised a combination of measurement and modeling
techniques. We conducted measurement studies of the evolution of the
Internet topology at the AS-level, revealing important overall trends in the
Internet AS topology (growth, rewiring, and densification), geographical
differences, and topology dynamics associated with different types of
players (content, transit and enterprise networks). From flow-level
traffic measurements collected at multiple vantage points we inferred
statistical properties of the interdomain traffic matrix. We used the
measured characteristics of interdomain traffic to create ITMgen, a tool for
generating synthetic interdomain traffic matrices that match the measured
statistical properties. Finally, we characterized the peering practices of
Internet transit providers using publicly available data from PeeringDB.

We developed two models of AS interconnection and dynamics and parameterized them with real-world data.
ITER and GENESIS.
These agent-based network
formation models account for the roles of economics, interdomain traffic
flow, and provider/peer selection strategies in shaping the structure of the
interdomain topology. We validated these models using publicly available
data, and investigated a wide range of "what-if" scenarios related to the
possible evolution of the Internet ecosystem. The ITER model shed light on
the"flattening" trend in the Internet's interdomain topology, and identified
the key factors responsible for that transition. With the GENESIS model, we
were able to simulate the network formation process, compute distinct
equilibria and to also examine the behavior of sample paths that do not
converge, analysis which is not possible with analytical game-theoretic
models of network formation. We also used the GENESIS model with
game-theoretic analysis to explain the gravitation towards Open peering by
Internet transit providers and determine the economic impact of this trend.

While we have made substantial progress towards measurement and modeling of
interdomain economics, work has also revealed areas where more needs to be done.
First, computational models that capture the diversity of the real world --
in this case the Internet infrastructure ecosystem -- are highly complex,
and thus cannot reasonably be run at Internet-scale. Scaling up our models
by exploiting parallelism and distributed computation is a focus of our
future work. Second, evolutionary trends in the Internet ecosystem are both
influenced by and influence interdomain economics. For example, recent
measurements have illuminated an expanding role of major content providers
and CDNs in delivering content. Simultaneously, we see vertical integration
of transit, access, and content providers, muddling traditional
classifications of Internet entities and raising important questions of
whether some of these players could exercise market power. Fifteen years ago
the AS topology modeling involved simple
customer-provider or settlement-free peering relationships between network
service providers; today's relationships often fall somewhere in between
these two relatively straightforward interconnection agreements between
providers. Little is known about the prevalence of these more complex
interdomain relationships, much less how to incorporate them into
interconnection economic models. Our future work will consist of extending
the scope of our computational models to account for these, and other
factors that influence interconnection economics.

We disseminated results from this project widely in publications at
scientific journals and conferences -- 4 journal publications and 10
conference publications resulted from this work. These publications have
been cited a total of 132 times as of October 2013. We published other
interesting tidbits from this research on the CAIDA blog. We began a series
of workshops at CAIDA focused on Internet Economics, which included
participants from experts in academia, public policy, and industry. We
published reports on these workshops (2009,
2011
and 2012), in the ACM
SIGCOMM Computer Communications Review (CCR). We have made all our collected
measurement data, as well as the source code for our computational models
and simulators, available publicly to researchers. Participants in this
project made 19 presentations at research conferences, operational venues
(NANOG), and policy bodies (FCC).